FTC Drives International License Marketers out of Business

Two marketers of false international driver’s permits (IDPs) and one financial processor for IDP marketers have settled Federal Trade Commission charges that they violated federal laws by deceptively claiming that their documents could take the place of a government-issued driver’s license or other identification. A financial processor also has settled charges that it participated in an IDP scam. The proposed settlements permanently prohibit the defendants from selling IDPs.

In January 2003, the FTC filed separate complaints in federal district court against the following defendants: 1) Yad Abraham, a.k.a. Tim Thorn and Timothy Thorn, individually, and d.b.a. Sharpthorn Internet Solutions and Internex, LLC; 2) Carlton Press, Inc., Carlton Press, Ltd., and Kim Fleming Bo Weiss; and 3) Mountain View Systems, Ltd., Wheelie International, Ltd., Aladdin Travel, Inc., S.C. Hyacinth S.R.L., Jason Abraham, Caroline Shallon, and Charles Fogel, all doing business as the Institute for International Licensing.

In each complaint, the FTC alleged that the defendants deceptively claimed that their bogus documents were legal substitutes for state-issued driver’s licenses, and misrepresented that their IDPs enable consumers to drive legally in the United States and abroad, enable consumers to protect themselves against traffic violations, and could be used as a legitimate form of government photo identification. The Commission charged that the defendants’ scams placed consumers at risk of legal actions or arrest if caught driving without a valid license or presenting false identification. Additionally, the FTC argued that these worthless documents would encourage unlicensed drivers or drivers with suspended or revoked licenses to take to the roads. The FTC’s complaints were part of “Operation License for Trouble,” a six-case, nationwide law enforcement sweep charging marketers of IDPs with scamming consumers out of hundreds of dollars each.
 

Authentic IDPs enable a person with a valid driver’s license to drive in foreign countries that have signed the 1949 United Nations Road Traffic Convention. The IDP is a simple booklet that translates a consumer’s government-issued driver’s license into different languages; it is not a substitute for a valid, government-issued license. It cannot be used in place of a suspended or revoked license or as a government-issued identification card. Further, it will not protect consumers from traffic tickets or “points.” In the United States, legitimate IDPs cost $10 each, and can only be obtained from the American Automobile Association (AAA) and the American Automobile Touring Alliance (AATA).

In each of the three cases, the proposed settlements permanently bar the defendants from: selling any IDP or other identification document; misrepresenting that any IDP authorizes consumers to drive legally in the U.S. or abroad; claiming that IDPs can protect consumers against points and traffic sanctions; misrepresenting that an IDP can be used in place of a government-issued identification document; and making false or misleading claims for any good or service. The settlements also bar the defendants from assisting others in these practices. In addition, the settlements contain various recordkeeping provisions to assist the FTC in monitoring defendants’ compliance.

Yad Abraham. The FTC’s complaint alleged that the defendants used a Web site, drivelegal.com, to deceptively claim that their IDP could be used to “get out of many tickets with a simple warning” and that their program was “100% Legal.” Their nationwide advertising scheme also allegedly claimed that their IDPs met all the conditions of the U.N. Convention. Abraham’s IDP cost $350, plus shipping and handling. The settlement provides a judgment for $2.1 million in consumer redress and disgorgement of ill-gotten gains. Payment of this amount will be suspended, however, based on Abraham’s inability to pay. The case was filed in the U.S. District Court for the Central District of California, Western Division. The court entered a default judgment against Internex, LLC on May 1, 2003. Litigation as to a remaining defendant continues.

Carlton Press. According to the FTC’s complaint, the defendants used two Web sites to pitch purportedly authentic IDPs for $147 each beginning in October 2000. The proposed settlement, which concludes the litigation, orders $25,000 in consumer redress and disgorgement of ill-gotten gains, which will be suspended based upon the defendants’ inability to pay. The case was filed in the U.S. District Court for the Southern District of New York.

Aladdin Travel. According to the FTC’s complaint, Aladdin Travel was part of a scheme, operating under the name Institute for International Licensing, to market and sell phony IDPs via unsolicited e-mails and the Internet. The IDPs sold for $375. The proposed settlement orders Aladdin Travel to surrender funds currently held in its bank account as consumer redress or disgorgement to the U.S. Treasury. The case was filed in the U.S. District Court for the District of Columbia. Litigation against the other defendants is ongoing.

The Commission vote to authorize the staff to file the complaints and stipulated final judgments with respect to Yad Abraham, Carlton Press, and Aladdin Travel was 4-0-1, with Commissioner Pamela Jones Harbour not participating. The settlements announced today are subject to the respective courts’ approval.

NOTE: These stipulated final judgments are for settlement purposes only and do not constitute an admission by the defendants of a law violation. Stipulated final judgments have the force of law when signed by the judge.

Copies of the complaints and stipulated final judgments are available from the FTC's Web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint, or to get free information on any of 150 consumer topics, call toll-free: 1-877-FTC-HELP (1 877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

03-CV-00021-RMC – Aladdin Travel
03-CV-0226-RLC – Carlton Press
CV 03-0030 VAP (SGLx) – Yad Abraham